Anthony Goudie v Commissioners for Her Majesty's Revenue and Customs

Decision date: 5 November 2010

Neutral citation: [2010] UKFTT 552 (TC)

Overall AI summary confidence: high

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Short overview

This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.

AI confidence in this short overview: high

This appeal concerned unexplained deposits into a Woolwich account controlled by the appellant, leading HMRC to amend 2004/05 and 2005/06 returns, make discovery assessments for 2002/03 and 2003/04, and impose s.95 TMA negligence penalties. The tribunal found the appellant failed to explain £8,803.01 of deposits, rejected his limited explanations and evidence, and held HMRC acted reasonably in extrapolating the under‑declaration to adjacent years. The appeals were dismissed and the assessments, amendments and penalties confirmed.

Ratio decidendi

This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.

AI confidence in this ratio decidendi summary: high

Where a taxpayer controls a bank account, the taxpayer bears the onus of satisfactorily explaining unexplained deposits to displace HMRC's treatment of them as undeclared income; if HMRC identifies an under‑declaration in one year and the taxpayer gives no satisfactory explanation, HMRC may reasonably extrapolate that under‑declaration to adjacent years and make discovery assessments or amendments accordingly.

Obiter dicta

This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.

AI confidence in this obiter dicta summary: medium

The judgment indicates (but does not purport to lay down a novel binding rule) that once HMRC demonstrates unexplained receipts, negligence may be inferred if the taxpayer cannot satisfactorily explain them, and that documentary corroboration is important where non‑taxable sources (gifts, sales, cash withdrawals) are relied on.

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